Tax implications on share purchased through employees share purchase scheme

443 views 4 replies

I had purchased shares under ESPS scheme. I wanted to know what is the tax implication on the discount offered on the share. As I am salaried person can I file return through ITR 1. 

Replies (4)

At the time of allotment of shares on the exercise date, the difference between fair market value of the shares as on exercise date and the amount that employee have paid for the exercise or subscripttion to the shares is calculated and taxed accordingly. This taxable value is called Perquisite value.  This difference calculated is eligible for TDS deduction by the company and forms part of salary of the employee which is shown in Form 16 and Form 12BA of the employee.

When employee opts to sell the shares previously allotted under the ESOP,  profits made by him are taxed as capital gains earned during the year. These Capital Gains are calculated by subtracting the fair market value as on the exercise date from the sales consideration of such shares.

Can I file ITR 1 this year as I have only purchased shares under ESPS.

No, being investment in unlisted shares.... ITR 2 will be mandatory.

My investment is in Public sector bank so can I file in ITR 1

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
06 July 2026
Senior Accountant

Arvindkumar Maniar & Co.

Rajkot

CA

View Details
Company
ARTICLESHIP 08 July 2026
Article internship

AJAY SINGH AND CO LLP

Thane

CA Final

View Details
Company
21 July 2026
Chartered Accountant

Keshri & Associates

Thiruvananthapuram

CA

View Details
Company
25 June 2026
Accounts & Taxation Executive

Dindukurthy & Associates

Hyderabad

MBA

View Details
Company
06 July 2026
Chartered Accountant (Indirect Taxation)

Gowra Ventures Pvt Ltd

Hyderabad

CA

View Details
Company
ARTICLESHIP 30 June 2026
2 posts Article assistant and Articleship completed students

Chirag N Shah & Associates

Mumbai

CA Inter

View Details
Company
ARTICLESHIP 11 July 2026
Article

SNCO

Mumbai

CA Inter

View Details
Company
ARTICLESHIP 10 July 2026
Article Assistant

N S Gokhale & Co

Thane

CA Inter

View Details